Instacart allows users to see grocery delivery in as little as two hours from a number of retailers including Costco and Whole Foods. The service is presently available in Atlanta, Austin, Boston, Boulder, Chicago, Denver, Houston, Los Angeles, New York, Philadelphia, Portland, San Francisco Bay Area and San Jose. The company that was founded in San Francisco is expanding rapidly under the direction of CEO Apoorva Mehta.
Instacart – Massive valuation growth
In June of this year, Instacart was valued in the neighborhood of $400 million following an investment round that raised $44 million with the lion’s share coming from the venture capital Andreessen Horowitz. In this round, according to the report at Re/code, Kleiner Perkins but up $210 million in a round that plans to raise a total of $220 when its finished. Where the other 10 million is coming from has not been disclosed in the same regulatory filing that shows the Kleiner Perkings investment.
Just last year, the company had only operated in San Francisco but has expanded from coast-to-coast quite rapidly. The company also unveiled its Instacart Express package that provides free delivery on orders over $35 for an annual membership of $99. This is considerably cheaper that the $299 Prime membership option that Amazon offers on its grocery delivery service.
“The economics of this are working out pretty well,” said CEO Mehta. “With Instacart Express it doesn’t even make sense for customers to go to the grocery store anymore.”
Instacart – Looking to go it alone rather than be acquired?
Presently, Instacart is strictly a grocery delivery company but plans to expand into other areas in the next year.
With this new investment, it looks less and less likely that Mehta is looking to have Instacard acquired by either Google or Amazon and appears that he wishes Instacart to be a stand-alone company that is able to make money on its own.
Since its beginnings in 2012, Instacart has raised money from Sequoia Capital, Khosla Ventures, Canaan Partners, Y Combinator President Sam Altman and Box CEO Aaron Levie as well as the aforementioned investors in the latest two rounds.